Martin Mansergh (Tipperary South, Fianna Fail)

I thank Deputy Creighton for raising this issue.

In 2009, Dublin Inner City Partnership, DICP as it is referred to, was allocated some €1.1 million under the Department of Community, Rural and Gaeltacht Affairs Local Development Social Inclusion Programme, LDSIP, to implement measures tackling social and economic exclusion in Dublin's inner city. That funding was provided through Pobal, which managed the programme on behalf of the Department. It might be noted that DICP had been in receipt of LDSIP funding over many years and was also in receipt of FÁS funding to provide the local employment service in the area.

In January 2010, the LDSIP and community development programme, CDP, were superseded by the new local and community development programme, LCDP. Under the new programme an allocation of €1,074,855 was made to DICP by Pobal, which also manages the new programme on behalf of the Department. On the 18 January, €107,485 was issued to DICP as a first payment from this allocation. DICP would also have FÁS funding for 2010. As part of its programme management role, Pobal has a remit to manage Government funds in a transparent and prudent manner, to provide guidance and support on organisational management and governance and to conduct independent audits of beneficiaries based on risk analysis.

After funding allocations for 2010 had been settled, Pobal was completing a follow-up audit on foot of a previous audit completed in March 2008 which audit had given rise to major concerns about weaknesses in financial controls and procedures, non-compliance with programme accountability requirements and payments of salaries in excess of approved scales. Following that audit, the company had been given an opportunity by Pobal to address those issues and had committed in writing to so doing by 31 March 2009. However, the follow-up audit to which I have referred revealed that DICP had not addressed the issues despite the commitments made.

On 1 April 2010, the board of Pobal decided to cease its contract with DICP in light of the concerns about weaknesses in financial controls and procedures, non-compliance with programme accountability requirements, payments of salaries in excess of approved scales and the failure on the part of the company to address those issues. The Department, given its duty to protect public funds, strongly supported the Pobal decision to cease the contract and believed that Pobal had no alternative but to do so. DICP was given an opportunity to appeal the Pobal decision and has done so. It is expected the appeal process will be completed before end-May 2010.

It is the objective of the Minister, Deputy Carey - the Department and Pobal have taken steps to ensure this - to ensure the decision to cease the DICP contract will have no adverse impacts on services provided in the inner city area. Heretofore, the main role of DICP in the context of the LDSIP and LCDP programmes was as a provider of funds from allocations made by Pobal to community and other groups providing services in the inner city area. Pobal has met with all of the groups concerned and has finalised arrangements to manage directly the funding of their work. There will be no interruption or reductions in funding and the groups have been assured this funding will continue until a long-term resolution is found to the management of the new programme in the area.

Pobal has also been in discussions with FÁS on ensuring the non-disruptive continuation of local employment service, LES, and centres' operations in the area. I apologise to Deputy Creighton for the alphabet soup contained in the reply.

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